The OECD Workshop on Raw Materials

Over the last few years prices have risen sharply for commodities such as minerals, metals and agricultural products. At the same time, restrictions on exports of raw materials are more frequently obserseved and this has drawn the attention of business and policy makers to the question of access to raw materials.

This one-day Workshop willl give participants an opportunity to learn about and discuss the factual and economic aspects of export restrictions. The focus will be on two topics: economic impacts of export restrictions and the policy rationale of such measures.

Analysis of economic impacts will cover exporting countries as well as importing countries. Export restrictions generally bring about a decrease in export volumes which potentially divert supply to the domestic market. The Workshop will also draw attention to production in the exporting countries. There are instances where countries apply export measures in order to reduce domestic production. Impacts on importing countries will be considered, such as higher import prices and diversion of sources of imports.

Another objective of this workshop is to better understand diverse policy objectives of export restrictions. Many countries have applied export restrictions to secure domestic supply of food products at low prices. Conservation of natural resources is important regarding limited resources. Promotion of downstream processing industries is another motivation. Effectiveness of export restrictions in achieving these policy objectives depends on how these measures affect product price and quantity. Hence, a discussion of economic impacts and policy rationale complements each other.

Presentations from industry representatives, academic experts and governments will serve as a starting point for a broader discussion involving all participants. Several non-OECD member countries will be invited to share their policy experiences.

Chair: Mr. Simon Evenett, Professor of Department of economics, University of St. Gallen

Export restrictions generally bring about a decrease in export volumes which has various economic impacts on domestic and foreign markets. They may divert supply to the domestic market, leading to a downward pressure on domestic prices, while possibly raising importing prices and diverting sources of imports. Impact on domestic production also draws attention, considering that many governments apply measures to reduce domestic production for either conservation or environmental purposes. Impact on international price is another interesting point since these measures, by reducing international supply, can raise the international price of the products while these measures themselves might have been triggered by high commodity price. This session focuses on these potential effects on price and quantity of the products both in exporting and importing countries.

10:00 – 12:00Presentations from academics and business associations

Academic experts will provide economic analysis of economic restrictions covering both theoretical issues and sector-specific features of the measures. Representatives from relevant industries will complement academic presentation by displaying on-field experiences, which will provide participants with an opportunity to better understand how these measures affect relevant industries.

Governments apply export restrictions to achieve several policy objectives. These include domestic food safety providing key prouducts at lower prices, and social policy objectives such as the conservation of natural resources. Export taxes may also be applied in order to increase fiscal revenues. However, not all countries rely on these measures to achieve such objectives and alternative targeted measures can be applied. The effectiveness of export restrictions in achieving policy objectives depends in part on whether such measures affect the price and quantity of the product as expected. Considering the existence of alternative policy tools, the question is whether and under which conditions export restrictions are most effective in achieving policy objectives and whether the economic costs of export restrictions are higher or lower as compared to the alternatives that are available.

OECD will introduce a list of policy objectives evidenced by current application of export restrictions. It will be followed by presentation from several government officials with the aim to share policy experiences. Why do several governments apply export restrictions to achieve diverse policy objectives? Why do several governments rely on alternative measures for achieving the same policy objective? Does the effectiveness of export restrictions vary depending on policy objectives aimed at? If several governments are concerned about the measures applied by other countries, what is the reason for such concern? These are the issues which we would identify by sharing policy experiences.